Trends of loans in January 2012

In year 2011, RBI kept increasing rates till Nov and just by the year end, they gave signals that rates may come down.
So in year 2012, here is what we expect in the loans market.

• Personal loans Trends

Personal loans  rates were stable in between 14%-40%. This range is defined by where do you work, how much you earn and what is your credit history.
So If you work for a top brand and your salary is above 75000 per month, you can get a personal loan for 14% but if you salary is 10000 and you work in a small company, you can expect 30-40% rate of Interest.
Personal loan are given on fixed rates so RBI fluctuation during your loan tenure doesn't affect your rates for your ongoing personal loan.This means once you take a Personal loan and the rate is given by the bank, this will not change - may whatever is the market condition.
For year 2012- we see Banks may tighten there norms for personal loans as they see that recession may hit India and Personal loan being unsecured loan, Banks will like to take a risk averse actions and may give it to only where they are sure of that they will get it back.
The rates may reduce if RBI eases rates and liquidity , but may only happen for top executives and best companies.

• Home Loans Trends

In year rates touched 11% due to many hikes pushed by Rbi actions on liquidity etc.In another major move the regularity body on home loans issues guidelines to housing finance companies to go away with prepayment charges. The housing loan companies did and some Banks also had to follow the step of giving away prepayment charges.
This is one major help for customers who can now shift to alternate Bank/housing finance companies if there existing Bank is charging at a higher rate.
For year 2012, we expect Rbi to loosen the liquidity and for existing home loan customers- rates may come down. We also see rates coming down for new home loan customers.

• Car loans Trends

In year 2012 - in the first quarter 50 new cars are set to be launched in India.This will bring a lot more push to sell more cars and thus leading to more Car loans.
Car loan rates are fixed , so for customers rates do not change during the tenure of the loan. For new car loan customers- rates may come down with liquidity ease measures expected in the first three months.
The rates may come down also for used car loan market.
Thus in end, the rates will come down this year-But how much will depend on the inflation in the country and RBI measures.So expect a better year for loan takers but anyways taking loan